Listed Companies' Announcement
COMFORTDELGRO CORPORATION LIMITED
MEDIA RELEASE - COMFORTDELGRO ENTERS INTO $44 MILLION BUS JOINT VENTURE IN SHENYANG, CHINA
ComfortDelGro Corporation Limited's wholly-owned subsidiary, ComfortDelGro (China) Pte Ltd, today entered into a $44 million joint venture contract with Shenyang Anyun Group Company to run bus operations in Shenyang, China.
ComfortDelGro will take an 80% stake in the joint venture through an initial cash investment of US$13 million (approximately S$22.1 million). This will be funded from internal resources. Shenyang Anyun Group's contribution will be in the form of the operating rights for the 12 bus routes approved by the Shenyang Municipal Traffic Bureau.
The new company, Shenyang ComfortDelGro Anyun Bus Company Pte Ltd, is ComfortDelGro's third joint venture in Shenyang. ComfortDelGro has been in Shenyang since 1996 with the formation of CityCab (Shenyang) Ltd which operates 270 taxis. This was followed by Shenyang ComfortDelGro Taxi Pte Ltd which was formed in December 2003 to operate a fleet of 1,021 taxis.
Shenyang ComfortDelGro Anyun will provide urban scheduled public transport services, tour coach chartering, rental of advertising space on the buses and bus stops, and automotive repair and maintenance services in the Chinese city. It will commence operations with 12 bus routes and a fleet of about 400 buses.
At the signing ceremony in Shenyang today, ComfortDelGro Managing Director and Group CEO Kua Hong Pak called the joint venture an "important milestone investment" for the Group in Shenyang.
"We are resolute in our plans for expansion in Shenyang and North Eastern China. We look forward to more business opportunities and bigger projects in the public transport industry in Shenyang," he said.
The joint venture partner, Shenyang Anyun Group, is a major land transport operator in Liaoning Province. Its main business activities include operating taxis, mini-buses, tour/charter buses, logistics and automotive engineering.
Shenyang Anyun Group's General Manager He Wen Jiang said that while the company's businesses had grown over the years, it still had much to learn about public transport operations.
"To be able to join hands with a world renowed transport group such as ComfortDelGro is our honour and we are very eager to work with them."
Shenyang is the capital of Liaoning Province and has a population of more than seven million people. There are some 4,400 public buses in the city operating on 119 bus routes. Liaoning Province is one of the three north east provinces in the PRC, together with Jilin and Heilongjiang, which the Chinese government has committed to develop. As the biggest and most developed city in the north east, Shenyang will benefit from the renewed economic activities. ComfortDelGro's investments in Shenyang will therefore put it on a firm footing to participate further in the privatization of state-owned land transport companies in these provinces.
Shenyang Municipal Transport Bureau Director Sun Chang Lin said at the signing ceremony yesterday that the joint venture would serve as "a catalytic effect" in Shenyang's public transportation system.
"We hope that with its high level of service and excellent business management skills, Shenyang ComfortDelGro Anyun Bus Company Pte Ltd will be able to generate fresh contributions to the transportation system in Shenyang. We also welcome the prospect of ComfortDelGro Corporation Limited working with us in more profound ways so as to propel the transportation scene in Shenyang forward and upward," he added.
Background:
ComfortDelGro is the world's second largest land transport company with a total fleet size of more than 36,000 buses, taxis and rental vehicles. It has operations in several countries including China, the United Kingdom, Ireland, Vietnam and Malaysia. Currently, 35% of the Group's revenue comes from abroad.
For more information, please contact:
Tammy Tan
Group Corporate Communications Officer
ComfortDelGro Corporation
DID: 6383-8021
HP: 9683-0732
Email: tammytan@comfortdelgro.com.sg
Submitted by Bobby Tan Cher Chong, Company Secretary on 27/09/2004 to the SGX